Gate.io Implements Zero-Knowledge Tech in New Proof of Reserves Method
Panama City, Panama, November 23rd, 2023, Chainwire
Gate.io, a leading cryptocurrency exchange and Web3 innovator, has announced upgrades to its Proof of Reserves (PoR) process, which includes a new open-source method utilizing zero-knowledge technology. Following the upgrade, the PoR process will now cover the top 100 digital assets, with certificates published regularly for enhanced transparency.
Gate.io pioneered PoR in 2020 by enlisting a third-party auditor to verify exchange wallets, compile user balance data in a Merkle tree, and publish the anonymized data. This allowed users to securely and privately verify that their account balances were reflected in the data compiled, therefore confirming the exchange truly holds their assets. The process was repeated following the collapse of FTX. While this method does provide security, privacy, and independent verification, it was identified that there was still room for improvement.
The latest upgrade has introduced zero-knowledge technology (zk-SNARKs) to Gate.io’s existing PoR process. Primarily, implementing zk-SNARKs addresses concerns about the previous method, which left open the possibility of including fabricated accounts with negative balances to alter the data. In addition, the enhanced process upholds and improves upon the following:
- Privacy Protection: Users can conduct asset verification while retaining the privacy of assets and identities.
- Accuracy: Zero-knowledge proofs ensure higher accuracy in the data presented to and verified by users.
- Risk Reduction: Various risks, such as data leakage, identity theft, and other potential threats, are better mitigated by implementing zero-knowledge proofs.
Following the upgrade, PoR certificates will be generated utilizing the new process and covering the top 100 digital assets by market capitalization. The PoR certificates will be regularly generated and published on Gate.io’s Proof of Reserves webpage, where users can verify the results independently. Additionally, to continue to meet the diverse needs of users in an ever-evolving market, Gate.io will regularly evaluate the market and gradually increase supported currencies.
Currently, if user deposits are deducted from the total reserves, a balance of around $400 million USDT worth of various assets is present. This surplus is crucial for safeguarding user assets, as the assets held in reserve exceed total user deposits. This reflects the stability of the exchange and the commitment to protecting users’ rights and interests.
The latest upgrades have been released as open source and align with existing guarantees and Gate.io’s founding purpose: to provide safe, secure, and reliable digital asset services. More information about how zk-SNARKs improve Gate.io’s PoR is available on Gate Learn.
About Gate.io
Established in 2013, Gate.io is one of the world’s earliest cryptocurrency exchanges and a leader among compliant and secure digital asset platforms, offering diverse trading services with 100% user-verifiable Proof of Reserves. Further, the platform has consistently ranked as one of the top 10 cryptocurrency exchanges based on liquidity and trading volume on CoinGecko. Besides its primary exchange services, Gate.io has diversified its ecosystem to offer decentralized finance, research and analytics, venture capital investing, wallet services, startup incubation, and more. The platform currently serves more than 13 million active users worldwide.